With health care costs and patient deductibles rising, physicians are discovering that cost is an integral part of the conversation with patients during an office visit.

Studies have shown that patients and doctors want to engage in such discussions, despite worries about potential awkwardness. Physician advocates and medical societies say these conversations could lead to lower costs for patients without lessening the standard of care.

How a practice brings patients into this conversation is important. Surveys have found that some patients are hesitant to talk about their finances to a doctor, and others demand the gold standard of care for themselves, believing anything less expensive is less effective.

Susan Dorr Goold, MD, a professor of internal medicine at the University of Michigan Medical School, helped survey more than 200 insured people in 2011. The study asked participants to imagine themselves with various symptoms and a choice of treatments that vary slightly in effectiveness but significantly in cost. Most patients wanted the most expensive option for themselves, Dr. Dorr Goold said. Some wanted to “get back at” insurance companies for the high costs they pay in insurance.

“One of the things we found is more expensive always means better to many patients when it comes to their own health care, even though that's not always true,” Dr. Dorr Goold said.

Talking about prices is gaining traction

Medical societies and other physician organizations are encouraging cost reduction and conversation, pointing out that U.S. health care accounts for 17.6% of the gross domestic product, making it a burden for government, businesses, families and individuals. Plus, $750 billion a year is spent on tests and procedures that don't make patients any better.

At the American Medical Association Annual Meeting in June 2012, delegates approved a report by the AMA Council on Ethical and Judicial Affairs that says wise stewardship of limited health resources is an ethical obligation for physicians. The report also said patients and their families can be involved in decision-making, with the case for a less-expensive, but equally effective, treatment spelled out for them.

Meanwhile, more than 36 specialty societies are now part of Choosing Wisely, an initiative that encourages doctors and patients to talk about treatments and procedures that may not be necessary and may, in some instances, cause harm in the long run. Glen Stream, MD, board chair of American Academy of Family Physicians, said that although the main goal of Choosing Wisely is better medical practice, cost is a positive byproduct.

In 2009, Neel Shah, MD, an obstetrician-gynecologist, started Costs of Care, a nonprofit in Boston that aims to transform health care delivery by empowering patients and physicians to reduce medical bills by rejecting or replacing costly procedures that don't improve health.

“It seemed crazy to me at the time that we didn't talk about cost,” said Dr. Shah, executive director of Costs of Care. “I'm finding that this is patient-driven. Patients want this information, because they're taking the first couple thousand of dollars in medical costs on the chin.”

Steps to starting a dialogue

Dr. Stream said doctors need to have their patients' trust, which will help when recommending a specialist the patient has never seen. “I tell the patient, 'I have faith and confidence the specialist will help us take the best care of you,' ” he said.

Speak to patients in nontechnical language, Dr. Stream said. When refusing to do a certain test or procedure, provide the patient with literature on the subject or read it together at the Choosing Wisely website, he said.

“Say, 'This is what you have, this is what is recommended, and this is what is not recommended.' This not only shows you care about the patient, but that you're participating in the latest, state-of-the-art medicine,” he said.

Doctors should talk to patients in an authoritative, matter-of-fact way to make them understand that their asking about insurance is a medical question, not a personal question, said Mark Hall, professor of law and public health in the Division of Public Health Services at Wake Forest University in North Carolina.

“Do not ask about ability to pay, but the extent of their insurance coverage,” Hall said.

Over three years, he interviewed primary care physicians who treat low-income patients to see how the patient-physician relationship changed now that patients pay more for their health care out of pocket. Physicians told of patients who didn't fill prescriptions or refused treatment due to a lack of money. The study found that patients want doctors to help them make the best decision medically and financially.

Doctors need to be good problem-solvers, said James Cunnar, MD, a solo family physician in Naperville, Ill. He talks about cost to all of his patients, even though his practice is in an upper-middle-class area, then follows through with lower-cost alternatives for drugs and procedures.

“I could spend five grand in five minutes, but my job is to say this is what I can do for you at this price,” Dr. Cunnar said.

He asks patients how good their insurance coverage is. If it's bad, he prescribes generic drugs and tells them which pharmacies have good offers. He also works with freestanding imaging centers, which have lower costs than hospitals.

Dr. Dorr Goold said her study showed there are ways for a physician to tackle the subject of cost successfully with patients. They include using the deferral strategy when patients want an unnecessary procedure such as an MRI for back pain that started only a few days ago.

“Tell the patient it doesn't make sense to have this procedure at this time, but it might make sense later. Tell them to come back in a couple weeks, and if it's worse, we'll check it out,” she said.

Dr. Dorr Goold also recommends that doctors stand on their personal integrity, explain that expensive doesn't always mean better and inform patients that no test is 100% accurate.

“Tell them, in your medical opinion, you can't say that they need this procedure at this time, and you won't be able to defend it if the insurance company questions it,” she said.

Ask patients if it's worthwhile in time and cost to have a test with 99% accuracy over one with 98% accuracy.

Dr. Shah said doctors can explain to the patient that he or she can get an expensive MRI, but it will find all kinds of things, some of which doctors don't know how to interpret. “Ask them, 'Do you really want or need this?' ”

Karen Caffarini covered practice management issues during 2008-09 and writes for us occasionally on the topic.